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Longer opt-in period for leaky building class action

The Court of Appeal has allowed a representative class action against James Hardie New Zealand, for inherent defects in its ‘Harditex’ and ‘Titan Board’ cladding systems that allegedly contributed to a large number of leaky homes. The class action alleges that James Hardie was both negligent in its manufacture of the cladding systems, and breached the Fair Trading Act by making misleading and deceptive statements.

The decision means that previous or current owners of leaky homes using the James Hardie cladding system may opt-in to join the self-funded class action.

James Hardie had appealed the class action on the ground that the claims were too complex and varied to justify a representative class. The Court did not accept this argument, instead finding that the considerations for each individual owner were materially the same or similar, and were well suited to a class action. The Court endorsed the class action in the interests of a just, speedy, and inexpensive determination.

The period for new class members to opt in was also extended from 10 weeks to 5 months. The Court rejected submissions that extending the opt-in period would mean bypassing or undermining the Limitation Act long-stop period. It held that the general class action was raised within time, and James Hardie was therefore put on notice as to the nature and potential scope of the claims before the long-stop period expired. The 5 months was decided as a reasonable period in the circumstances to allow potential class members to be made aware, and conduct any necessary investigations before making their decision.

For more information on Cridge v Studorp Ltd [2017] NZCA 376, read the Court of Appeal’s full decision.